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Join Blake Hunter, Iowa and Nebraska REALTOR, with his clients and colleagues as they discuss the current market, and the ins and outs of buying and selling real estate in the Omaha/Council Bluffs area.
Blake Hunter (00:01)
Good morning, Rich. Thanks for joining me on what I'm sure is also a cold morning in the Des Moines greater area as it is in Omaha, Nebraska.
Rich Bales (00:08)
Yeah.
Very much so. Yeah, thanks for having me. I think it's like negative 20 something wind chill.
Blake Hunter (00:17)
When you wake up and there's frost on the inside of your windows, it's never a good sign. Probably a good day to have good insurance coverage,
Rich Bales (00:25)
Yeah,
yeah, inevitably we're going to get some calls. There's going to be some pipes bursting today.
Blake Hunter (00:30)
Yeah. So today, Rich Bales is joining me. I told Rich, I'm going to introduce him by reading his Instagram bio. It says, helping luxury homeowners and business owners navigate insurance with modern processes. Bales Insurance Team at Phillips Stafford Insurance Group, Urbandale, Iowa. So Rich, we have a mutual friend. We probably have more than one mutual friend, but our friend Jamie Nielsen gave us an introduction. want to give her a shout out because
Rich Bales (00:58)
Yeah, shout out to Amy.
Blake Hunter (00:59)
Jamie's a close
friend and she said, hey, I was golfing with Rich and I just felt like you guys would really hit it off. So you guys need to connect. And here we are like six months later, maybe even longer connecting. So Rich, tell us a little bit about yourself.
Rich Bales (01:14)
Yeah, for sure. So, I mean, winding it all the way back, I grew up in mostly in Pella, Iowa. That's where, I spent most of my childhood. I bounced around a little bit before that, but yeah, I grew up an only child there. I've got three half sisters that they lived with my dad, which has been fun later in life reconnecting with them. yeah, had a pretty basic childhood there. Grew up, went off to Iowa State.
Um, where I was a cyclone for four years, got the opportunity to run track there. So, um, it was pretty cool. got to see the country when I had really never been outside of Iowa prior to that. So really just kind of opened my eyes to, you know, different people, different parts of the country, stuff like that, which was fun. Um, from there was pretty determined to go into being a physician. Um, funny enough. And in hindsight, I kind of looked back at that and I think the big draw of that was just stability. I just didn't know it yet.
I had some pretty good examples in my life of people who were doctors and just the lifestyle they lived and the stability they had in their homes and things like that. When that didn't work out, there's a bunch of different things going on with family and stuff like that. Got really lucky, got introduced to somebody who was in medical device sales. One of the physicians I had been shadowing knew him and just said, hey, why don't you call this guy? name is Troy Cush. If you're in the Omaha area, Cush 7-Day Furniture, shout out them. It's the same guy.
Blake Hunter (02:37)
Okay.
Rich Bales (02:40)
So, yeah, so he was in medical device sales at the time and they said, hey, this guy did it fresh out of college. You should just call him and pick his brain. So it wasn't even one of those like, hey, I'm looking for a job. It was more so like, I just want some perspective. Like I didn't even know what this was. So ironically enough, him and I hit it off really fast. He ended up becoming one of my best friends still is to this day. But I said, you know what? think this is gonna be the right move for me. So I jumped into that.
very quickly thereafter, probably six months, a year in, Troy steps aside, goes into his family business, and I'm kind of thrown into the fire. Like, hey, this is your territory now, you're gonna run it.
I was really fortunate, had quite a bit of success, kind of found a knack for what I was doing. liked the nerdy side of it where I could really kind of scratch that itch for myself because I loved the science, I the biomechanics, all that stuff. But at same time, I had the opportunity to be educating and selling to these surgeons where it was really creating an impact for people. time went on with that, eventually kind of worked my way up into more of a management role, took over more states, bigger team, stuff like that.
And yeah, was really enjoying it. But along the way, my wife and I had gotten married, we had had our first kid, and then I had also started investing in real estate on the side and kind of got a taste for what it would look like to maybe not have a W-2 job. So yeah, just a combination of things where there was an ownership change of that company and maybe I didn't align quite as well with the new owners, know, building a family, all of our family lived back in Iowa.
One day, my wife and I was like, I don't know, probably our third weekend in a row, driving back and forth for a birthday party or whatever it might be. I just threw it out there. I was like, should we just move to Des Moines? And without hesitation, she goes, yep. And so I was like, okay, well, you've obviously put some thought into this. I've thought about this. Maybe we should just do it. And so thus led the kind of kickstarting of, hey, I think I'm gonna do something different because...
Blake Hunter (04:38)
Yeah.
Rich Bales (04:45)
I saw what the long-term career of Meddevice looked like and the burnout rates and the travel and all that stuff. So I just said, I think I need to do something different if I'm thinking about, you know, 10, 15 years from now, instead of just thinking about tomorrow. So, um, so yeah, so I walked away from that career. I kicked around doing real estate cause I was like, Hey, I like doing these flips, stuff like that. Um, but I had been, I don't know, I'd done, I'd been in a quota job forever and kind of the thought of just starting over every year just didn't.
Blake Hunter (04:59)
huh.
Mm-hmm.
Rich Bales (05:14)
didn't sit well with me anymore. Father-in-law's a financial advisor. He said, you should be an advisor. That's the end all be all. I didn't trust myself with my money. So why would anybody else trust me with their money? And then he again was the one who said, you should explore insurance if you don't want be a financial advisor. Just the business makes sense, the way it's built.
Blake Hunter (05:23)
Yeah.
Rich Bales (05:37)
And he's like, you know, you're somebody who wants to build a team. You always enjoy it. Like the recruiting and the training part of your prior career. So just explore it. So thus started the journey of figuring out who cares my insurance. I didn't even know my insurance person. I just had it and they took care of it. And that was about it. So
Blake Hunter (05:52)
Yeah.
Rich Bales (05:56)
So I interviewed just about everywhere. I looked at State Farm, looked at Farm Bureau, Country Financial, Allstate, and then my real estate agent introduced me to my current group that I'm with, Philip Stafford Insurance Group, it his agent.
And it just gave me the freedom where I'm not really somebody who needed somebody to, you know, wake me up in the morning and tell me to go do stuff. So it was sort of the perfect balance of, you know, they are completely hands off, even when it comes to training, you know, it's kind of a self taught self, whatever, but that was perfect for me. So I took the leap and then here we are two and a half years later in the classic med device to insurance.
Blake Hunter (06:35)
Yeah,
a lot of people do that, I was really curious, just in our brief conversation before, you talked about investing in real estate, you're making this transition. I really thought that you may have considered real estate and I was really curious of why you didn't go that route. I to me, there's a lot of similarities in kind of what you do on a business basis and why you didn't choose that. So that's interesting that you pointed that out.
Rich Bales (06:36)
Yeah, it's kind of a building block.
Yeah.
Yeah.
Blake Hunter (07:05)
Funny, I didn't know your track background. know you probably know the the Bukites from Pella, right?
Rich Bales (07:12)
Yeah,
yep, Nathan was my age and then Zach was a couple years younger.
Blake Hunter (07:14)
Okay.
I know Zach just from, I ran cross country and track at Iowa Western. And then I went to UNI and I mean, I had a good friend that I lived with that was on the track team. And so I got to know a bunch of those guys and it's a small, small world we live in.
Rich Bales (07:22)
Okay.
Yeah.
think maybe one of the Pingles too may have been another fellow kid that was on the track team at UNI. So yeah. Yup.
Blake Hunter (07:37)
yeah.
Yep. Yep. Yeah. Very small world.
So, you know, it's hard enough to transition your entire job and start over and then especially in a job like real estate or insurance, it's like, how do you build your network when you're starting from ground zero, especially when you're moving to, you know, a new community? So what are some things that you did that you found success, you know, to build your business once you did that?
Rich Bales (08:07)
Yeah, I I think the thing I've gotten good at is taking something that somebody else has succeeded with or failed with and implementing it, right? So that entire first year, I've talked about this on a handful of podcasts, was just...
I set a goal for myself, I want to sit down with somebody every single day for the first year, for every business day. I ended up doing closer to a day for that full year, whether it was a ton of real estate agents, financial advisors, mortgage lenders, business owners, whatever it was. I just wanted to figure out how did they become successful and how can I apply that to my job as an insurance agent because...
I struggled, couldn't get a hold of other insurance agents because it was just like everyone kind of gave me that stiff arm of like, no, we're not in the business of like helping each other, we're competition. So I learned that pretty fast. And then I was like, well, you know what, there's a lot of other successful people that I could probably learn things from. So as simple as it is, think just activity was huge for me. Every day I was having conversations, which the goal wasn't really to like refine my talk or my speech or whatever, but
organically that happened because I started to learn the things that got good answers out of people and like, you know, lowered their guard enough to tell me why something worked or what really worked or what they were really looking for. And so in doing that, I think it really allowed me to differentiate myself in my conversations.
Whereas, I think I can pretty accurately predict what most insurance agents go in and talk about when they sit down with a realtor or a mortgage lender or whatever it is.
It was just, it was a good way for me to learn how to, again, just differentiate myself and also to challenge those people I was sitting with and going, okay, well, Hey, in the, you know, if I was talking to you, I'd say, okay, in the Omaha council Bluffs Metro, how many real estate agents are there? You know, 3000. Okay. Why you? And most people, that is a pretty like, um, that's a good question.
Blake Hunter (10:03)
Yeah. Yeah.
Rich Bales (10:11)
You know, unless you know that true value proposition and maybe you don't have one, that's okay. But like better to sort it out with me now than wait. Right. And so then for myself, I knew I was like, okay, I bet if I bet if I was another insurance agent, no thoughts going into it, I would sit down with you and go, okay, well, I've got all these companies. Like, here's how I do my quotes. They're really fast. They're really cheap. And then most people were like, well, yeah, but like, that's fine.
Blake Hunter (10:12)
Yeah.
Rich Bales (10:40)
But that's like, know, mortgage loan. Like if a mortgage lender says like, yeah, well I close on time. Yeah, cool. Like that's your job. If you're a realtor and say like, well yeah, well I put it on the MLS. Awesome. That's what everybody does. Right. And so the answer is I would always start to get back with like, oh, well I care the most. Or I, you know, it all these like intangible things that I was like, that's not different because everybody can say it. So.
Blake Hunter (10:41)
Then what? Yeah.
Mm-hmm. Mm-hmm.
Yeah.
Rich Bales (11:05)
I was just really intentional while being like, I want to have a conversation I know you're probably not going to have somewhere else and it's going to make you think. And I got good at that and in doing it, I uncovered all these little tidbits of like, um, the biggest thing I think it rolled back to is really people care about his client experience, right? If you send me somebody, you want them to come back to you and be like, man, that rich guy has dialed in. Like we got all these things we never would have had somewhere else. We understand it. We feel taken care of and we're to have a long-term partnership with them.
And then that just tees it up. So if someday they come to me and they're like, hey, we're starting thinking about buying a house. We're curious what numbers look like. And I go, yeah, that's awesome. You should call Blake back because you're tagged in our system. And so it's just creating value in a completely different way that we felt like wasn't really present in the market.
Blake Hunter (11:51)
Yeah.
And you mentioned when we talked before, know, one thing that was huge for you when you were, sorry, my, if I don't move enough, my office life. One thing you mentioned when we were talking before, when you were investing in real estate was, you know, one of the huge things that your real estate agent brought to the table was the network. And you're like, Hey, I need a person for this. need a person for this. And they had it. And you know, that, that for me is.
Rich Bales (11:58)
You're back.
Yeah.
Blake Hunter (12:19)
having a big network of people I can trust. I think, you know, the first person that comes to mind in real estate is, know, who's the who's your lenders that you'd like to work with, but as important in today's world, especially the changes in insurance, I mean, man, that insurance agent coming through and like having things ready to go. Not the day before closing is so big. you know, I think a lot of times it just
Rich Bales (12:42)
Yeah.
Blake Hunter (12:47)
it gets put on the back burner because you're like, you know, all I got to do is call, give them the address, get a quote, and that's what it's going to be. you know, now when people, when their insurance rates have gone up 100%, you know, and, and we're looking at, you know, uninsurable roofs and all these different things that were not top of mind in the recent past. mean, man, it makes a huge, huge difference.
Rich Bales (13:00)
Mm-hmm.
Yeah, I mean, it's changing the strategy for real estate agents, right? Where it's like, if you're going to list a property and you know it has a 20 year old roof.
there is the potential that that is no longer an insurable roof at replacement costs, which might mean that they don't qualify for loans on it. So that just limited your buying pool. if as a realtor, you're not up on that, you you could, you can put somebody in a bad situation. So that's where I'm, I'm actively going out and being like, Hey, let us be a partner. Let us help teach. Let us be involved earlier on because much better to have that happen.
Blake Hunter (13:29)
Mm-hmm.
Rich Bales (13:46)
you know, a day into the process, then like you said, that fire drill of like, Hey, this guy said he could do it. Now we're two days from close. Rich save us. And we happily do that, but I would rather say like, Hey, you just went under contract, get ahold of Rich. Here's a text introduction. We do it all. I can tell you, like, I can tell you the bad news on the front end. If it's going to be a thing.
Blake Hunter (13:53)
Yeah, I've gotten the call. Yeah.
Yeah.
Rich Bales (14:10)
Or we have it sorted out, we know, hey, here's where the price point comes, it helps your mortgage team because they're not done with all their loan stuff. So yeah, I am huge on that piece of the sooner we can be involved, especially in today's climate, especially in the Iowa and Nebraska markets because they are so tough. Minnesota too, they're even worse actually. It's just a benefit to everybody.
Blake Hunter (14:36)
So back to your coffees, doing nearly two a day. Is there any of them that really stuck out to you? Was there any pivotal moments when you met with somebody and you just saw things clear, something made sense to you?
Rich Bales (14:40)
Yeah.
Yeah, think probably like it's such a small thing, but one of the most impactful things for my business, there's a local group here, Key Mortgage Group in Des Moines. They're awesome. And they were one of the first people that really pushed on me that was like value over cost, value over cost. We are not going to be the cheapest, but we are going to nail this client experience thing.
And prior to that, everybody I had met with, like, mean, I didn't know anything yet was like, well, I've got a guy and he does it really cheap. And I'm like, okay, well, I don't know. Maybe I can figure out how to do it cheap. Right. And they were the first ones to be like, no, like we will not be the cheapest on rate, but we can guarantee you this experience is going to be immaculate. People are willing to pay for it and they're willing to, you know, do all these things to be involved in this experience. And I was like, man.
That's what I want. I'm not here just to get the cheapest clients or whatever because that just creates this unstable foundation. I remember hearing that and I knew these guys were successful. I just saw the Google reviews and whatever and I was like, I gotta really dive into that. That was kind of that first thing for me where I was like,
They're having a different conversation than anybody I've sat down with. And, you know, they were transparent. like, look, we have plenty of real estate agents that go, nope, we can go to a credit union. It feels like a win because it's cheap. And, you know, but that's just not how we roll. And maybe they're not a good fit and that's okay. And so they had like learned the ability to say no.
And so that was just like a small seed that was planted that now today has really, really evolved into kind of the core of how I look at things. I I'll filter Collins the same way. Or if I get a call from somebody and they say, hey, I'm for my home and auto insurance. I'm like, all right, perfect. You know, what's important to you? You know, if you just want it as cheap as you can possibly get it, I'm probably not your person.
because I'm only willing to go so low on things because at the end of day, I got to be able to sleep at night knowing you're taken care of. And you know, probably one in three people goes, yeah, honestly, I just need it as cheap as it can possibly go. And I go perfect. Go online, quote it through Allstate, quote it through Progressive. You'll get it as cheap as you can, but in the event something happens, it might not be great.
Blake Hunter (17:05)
Yeah.
Well, and if it's too good to be true, it's probably too good to be true. I mean, it's pretty simple.
Rich Bales (17:17)
Totally. Yeah, mean,
anybody who's 30 % under the market rate, there's a reason, right? They're either not paying claims, they don't have a ton of business, there's something there. So it's been so good for me and I look at my retention now, my retention is close to 100 % and that's because those people who have signed up with us are doing it because they trust us, they feel educated and they've bought into the value that we're providing versus just cost.
Blake Hunter (17:22)
Mm-hmm.
Yeah.
Rich Bales (17:45)
So that's not to say like there are plenty of times where we are the best price for them, but we don't sacrifice coverage to do it. it's, I think just from like a, I don't know, from like a mental capacity, like any professional for you, you could very easily be like, Hey, I'll do your listing for half a percent. And I bet you would all of them, you know, but it's like, you've got to value yourself and you got to value your time. And, you know, being the cheapest definitely doesn't mean being the best.
Blake Hunter (18:04)
Yeah.
Yeah.
No, mean, it's, know, and as you're, I'm sure well aware, you know, our industry has changed a lot in the last year and I still see things happening really the same way that they did, but there's definitely a different conversation that's had and, you know, showing people where the value is. My dad has been in the industry a long time and, you know, one thing he's always been a
Rich Bales (18:15)
So.
Blake Hunter (18:44)
you know, a value guy and preach like, hey, you know, we're going to get this money back through negotiation. We're going to get it back through a lot of other things and you're going to be ahead. But kind of the one line that has always stuck with me is like, if I'm willing to give up my money, what would I do with yours? And it's like, you know, I don't really like saying that to somebody, but it's the message. It's like,
Rich Bales (19:02)
Yep.
Blake Hunter (19:10)
I'm valuing my time and my effort and my capability and I know that I can make this right for you. And I'm like, if somebody's willing to come in here and do it for less, you're probably not gonna get the same service. I mean, why would you? So it's a pretty, I have no problem having that conversation and the people that really fight that, in my experience, are usually not a good fit as a client anyway. There's usually something that's not gonna.
not going to work for us, you know, in the long run. And so it's usually pretty easy to find out.
Rich Bales (19:38)
Right.
Yeah, and I think there is a place and a time. When you're brand new, you will do anything just to keep the lights on. That's okay. I had plenty of clients I wrote in my first six months where it was like, dude, I walked away from a career, like a great career with a wife and a daughter and another one come in and it was like, I got bills to pay. Things didn't go away just because I took this leap of faith. So I try not to like...
Blake Hunter (19:47)
Yeah. Yeah.
Yeah, I gotta do something. Yeah.
Rich Bales (20:09)
shame people in the beginning of their career because like you have to do it. You know, it's a necessary evil to get off the ground, but the faster you can get to the point where you can learn to say no and really lean into your value and truly believe in it, that's when your career takes off. So, and like kind of what you said, it's very hard to do, but
Blake Hunter (20:11)
Yes.
Yeah.
It's hard to do.
Mm-hmm.
Rich Bales (20:30)
You know, we talked about kind of being that quarterback for your clients is such a crucial thing. And that's one thing specifically in real estate agents that I think they miss out on a big opportunity to do. So we talked about my prior real estate agent. She introduced me to my insurance people, my mortgage people, all of my contractors. I mean, my attorney, you name it. And that was why I stuck with her.
Blake Hunter (20:53)
Yeah.
Rich Bales (20:55)
Honestly, when it came to like, didn't care if she was going to post it on Facebook or Instagram or whatever, because like realistically.
How many buyers were going to come from that? Probably not that many. Most of them were the MLS. But where that true value was created is all these important people in my life. She was the glue, the person that connected me to them. I think that's something a ton of professionals miss out on. So for us, that's one thing we're actually working with a videographer to go through and redo our whole drip campaign once clients come on board to make sure that we're insisting we make introductions.
Blake Hunter (21:29)
Yeah.
Rich Bales (21:30)
What that looks like for us is, we sign you up, you're a client, somewhere in the next three months you're gonna get a video that says, hey, if these people in your world are not a 10 out of 10, you need to shoot us a response so we can make an introduction. We wanna make sure real estate, mortgage lenders, commercial bankers, attorneys, CPAs, financial advisors, all of that, and on flip side we're gonna say, they are a 10 out of 10, I wanna meet them. So it's a win-win for that.
Blake Hunter (21:55)
Yeah. Good point.
Yeah.
Rich Bales (21:59)
And it's really, I mean, just allowed us to create really sticky clients. Cause the other day they're like, look, my insurance went up 50 bucks, but Rich introduced me to every important person in my financial team. Like we can't replace that. So.
Blake Hunter (22:09)
Worth it. Yeah.
It's interesting you say that about like Instagram and Facebook. obviously in today's world, the online marketing is a huge part. know, one thing that I've been using like in appointments, listing appointments and stuff is I'm part of a pretty big networking group in Council Bloss and it's all business owners and it's a pretty wide variety of people.
Rich Bales (22:31)
Mm-hmm
Yeah.
Blake Hunter (22:37)
And, you know, one thing I talked about is like, Hey, I'm going to share this, you know, obviously on my social media platforms. But one thing that I got going for me is all those people that are in that networking group are going to share it too. And then I also tell them in person when we meet on a weekly basis. And it's just, you know, it's small town. Iowa really in Omaha is no different. It's like, all it takes is 25 people that are well connected. And suddenly it's out there.
Rich Bales (22:49)
Yeah.
Yup.
Yeah? Mm-hmm.
Yup.
Yeah.
Blake Hunter (23:06)
And
so, you know, it's kind of a, you know, I really pride myself on kind of like a, a new school and old school mix of like marketing and sales is like, Hey, I'm going to give you old school customer service. We're going to do some old school marketing techniques that have always worked, but we're also going to do the new stuff like video, you know, professional, obviously professional photography these days, but all the new stuff, you know, to I'm telling you what.
Rich Bales (23:15)
Yeah.
Yeah. Yeah.
cell phone pictures aren't quite cutting it.
You got a thumb in the picture here before? So good.
Blake Hunter (23:35)
If I lose my mind when I see that, there's too many people.
I'm like, for what it costs to get a professional photographer in? I'm like, please, please just do it. man, I see way too many of them. The worst ones are when there's actually people in the background. I've seen quite a bit of those, but yeah, a guy sleeping on the couch, you know.
Rich Bales (23:44)
No brainer.
Yeah, like animals. Yeah, so good.
Yeah, like this was a Fizbo
Blake Hunter (24:00)
Yeah, yeah. mean,
that's literally, that's like what I always say to people. I see these people for sale by owner. Typically, they're overpriced. But I'm like, man, do yourself a favor. Like the pictures that you have are just horrible. And I'm like, even if you're already overpriced, but then on top of that, it's like I tell people, I'm like,
Rich Bales (24:10)
Yeah.
Yeah.
Blake Hunter (24:24)
I'll give you some advice and you can try that advice. like, maybe if I gave you that advice, you tried and it doesn't work. Like, let's have a conversation at least because I commend people that are trying to do it themselves, but it's just like, tell it's like everybody. like, I don't do my own taxes. You know, I trust my insurance agent. I, you know, I trust my financial advisor to make, you know, help me make better decisions. It's no different here.
Rich Bales (24:31)
Yes.
Mm-hmm.
Yeah. Yeah. And I think so that, that conversation I've taught a handful of classes, whether it be to like mortgage teams, whether it be to, real estate teams, whatever that ability to articulate almost that like challenge that you're standing there, I think is so good. So the example I always end the class with when I do those is I'll use a real estate agent, for example, where I'll say, okay, you got
Blake Hunter (24:58)
Mm-hmm.
Yeah.
Rich Bales (25:13)
Real estate agent A who sells a hundred houses a year. He crushes it, right? You got real estate agent B. He only sells 50. So he sells half as many houses. When they go under contract, the guy who sells a hundred houses shoots out an email that says, Hey, here's my three lenders. Here's my three insurance agents. Maybe there's some mention of a financial advisor, whatever. And then he lets his clients do it. He goes, you know what? I'm getting paid. You can use whoever you want. We'll just get the deal across the finish line.
Blake Hunter (25:17)
Mm-hmm.
Rich Bales (25:41)
Guy in option B has a process built out where he says, hey client, we just closed. I know you're really excited about this. You probably know somebody, but here's the deal. I do 50 of these transactions a year. If you have somebody, that's totally fine. Have a conversation with them, but I insist you at least have a conversation with my person because I know they're the best of the best. I'm gonna make production via text.
Blake Hunter (26:03)
Yep.
Rich Bales (26:05)
to my mortgage guy and to my insurance agent. And if you have two or three of them, totally fine. You just rotate. Who's a better fit for my client, whatever. And you go and you make that introduction via text after a conversation on the phone call. It took you 30 seconds. I'm gonna always ask the room, go, what percent of clients do you think use that 100 deal a year real estate agents people for both of those? What percentage? Most of them come back and say, I don't know, maybe 10, 15%.
Blake Hunter (26:10)
Mm-hmm.
Yeah.
Mm-hmm.
Rich Bales (26:34)
Okay,
the guy who insisted you had a conversation, called you about it, and then introduced him over a text. How many at-bats do you think you got your person? 90 %? 95 %?
Blake Hunter (26:44)
Yeah, it is.
I'm always telling myself that, you know, it's I'm always trying to learn and be better. And it's like, I have to remind myself so many times like that it takes follow up and it takes just a commitment to it, like telling someone one time, even though it seems like a no brainer to me, it's like I have to really preach that in order for someone to make that step to do it. And it's like,
Rich Bales (27:04)
Yep.
Right.
Well, and I don't think
they realize like when you can say like, Hey, I, I do this many deals a year. I see them go good. see them go bad and consistently with my person, they go really well. So have the conversation. They're not going to say no. then the other thing is, like, I know, I know everybody gets weird about like, I can't just have one guy. You don't have to just send every deal to one guy. You can send it to three different people or whatever, but guess what? If you're referring out 90 % of 50 deals, you are way more valuable to all of those lenders, all of those real.
Blake Hunter (27:16)
Yeah.
Yum.
Yeah.
Rich Bales (27:39)
real
estate agents than the guy who does 100 deals and barely ever connects the dots. So, so when reciprocity, that's a real thing in this world. When that starts to happen, they're go, that dude introduces me on a text message every time it has a conversation with his clients. Like I gotta find a way to help them out. And so that's why I think it's, you know, it's, it's free. Like it's free to like share your knowledge and clients want you to be the expert. So
Blake Hunter (27:43)
You just, you nailed it there. Yep.
Yeah.
Yeah.
Rich Bales (28:06)
Why not? You know, even say like, my uncle Joe's brother-in-law who we lived with in high school, you know, he does insurance. pretty sure. What's that? Yeah. Like, what do you know about him? Have you ever asked your mom and dad, have they ever taken a look? Cause a lot of times when we quote the moms and dads who've been somewhere for 20 years, it's a terrible policy or they're getting taken advantage of. Cause the guy just doesn't work you anything. And it's, I just encourage people do your due diligence.
Blake Hunter (28:07)
Yeah.
Yeah, my mom and dad use them.
Yeah.
Yeah. Yep.
So in insurance right now, what are you seeing? What are some of the struggles that you're dealing with and what should people be aware of? Especially on the real estate side when it comes to homeowners insurance and even like business insurance.
Rich Bales (28:51)
Yeah, so I mean, inevitably for anything property, it doesn't matter if you own an apartment complex, it doesn't matter if you own a manufacturing facility, if you're a first time home buyer, whatever, the market is going up, people are paying more. So the reason why this is happening is just because the losses have been so great over the last five years. So.
IMT for example, it's a huge insurance company. It's based out of Des Moines. They've been around since like 1890 or something like that. They've had like nine of their ten largest lost storms in the last like five years.
So the severity of storms has gone way up. The frequency of storms has gone way up. Obviously, Omaha takes it every year in hail. This year they had the big tornado. So these things continuing to happen are what's influencing it. And then you had from COVID, cost of materials went way up, cost of labor went way up, supply chain got changed a lot where it just takes longer to get things. So all of that raised the costs. The other piece we saw is litigation.
is way up. So I mean you see you see the trucker signs that are like hey have you ever been in a car accident call me we'll sue them and so what used to be a fender bender where you shook hands and they gave you a thousand bucks is now like my neck's gonna hurt forever I need three hundred thousand dollars and the insurance companies eat that but staying in line with the property side of things we've been fortunate in the Midwest historically to have pretty inexpensive insurance.
Blake Hunter (30:04)
Yeah.
Yeah.
Rich Bales (30:25)
But as the hail belt and wind belts have shifted over us, we're starting to play catch up. So if you look at like markets like Minneapolis, places like that, they're way ahead of us where they pay twice as much as we pay, but we're quickly catching up. So what that looks like, obviously premiums are going up because that's a way for the insurance companies to start to make up for some of these losses where they can get back to being profitable.
The other thing they're gonna do is they're gonna raise deductibles, which just says, if you're on the hook for more out of pocket, you're less likely to file a claim. So we're not gonna file little claims. So specifically when it comes to roofs and stuff like that, a lot of the Midwest, the strategy has always been like, well, we'll wait for hail and that's how we get roofs. Like nobody plans to set aside money to buy a new roof. It was just like, at some point it's gonna hail and we'll get one.
Blake Hunter (30:59)
Mm-hmm.
Yeah.
Yeah.
Rich Bales (31:15)
Right, but the only community that ever looked at it that way was some of like the investor community where they go, okay, well I'm setting aside 10 % for CapEx because I know it's gonna happen at some point and I'll need it, right? So now it's almost like we almost have to teach the standard home buyer to be like, hey, you need to be sending aside money every month to deal with these things so you don't get caught with your pants down.
Blake Hunter (31:28)
Mm-hmm.
Rich Bales (31:39)
And so we're seeing, mean, we've seen it specifically on the commercial side. Apartment complexes are now on all percentage wind-hail deductibles. So if you own, you know, a hundred unit apartment complex, it's $10 million building, your deductible might be 5 % of 10 million, which is huge. So again, this encourages that like more like financially responsible approach to home ownership, building ownership, whatever, where you're going to have some skin in the game. And then as, as you're purchasing it,
Blake Hunter (31:56)
Yeah.
Yeah.
Rich Bales (32:08)
things that are really going to impact price. A huge one is the roofage where, you know, whether you're listing it or whether you're looking at buying it, you need to know because that's a fairly substantial expense getting into it. And it's also really going to impact your insurability and like what that looks like monthly for you. you know, ideally you're under 15 years, you start getting over 20 years. That's something where if I'm looking to buy a house, I'm going to say like, Hey, this is a part of the deal.
Blake Hunter (32:20)
Mm-hmm.
Rich Bales (32:37)
this roof needs to be replaced before I purchase it because it's going to throw off everything and potentially get you to the point where it's not insurable. If it's not in good shape and it's over 20 years old, you may not be getting an insurance policy that covers replacement costs and then you might not be able to get a loan.
Blake Hunter (32:38)
Yeah.
Yeah.
Yeah. mean, I've run into several of those. not usually people knowingly, you know, they even had collected and not replace the roof at some point. You know, they had minor heel damage and they're like, well, we can live with it. we got the check and then here we are four years later, going to sell our house. And I'm like, well, you know, that is
Rich Bales (33:06)
I'm gonna go out of that.
Blake Hunter (33:18)
We got to disclose that and it's broken some deals because of the cost of having to replace a roof. And I've seen exactly what you're talking about, even personally, like owning some rental properties and even on my personal home, it's like, okay, you have a claim. It's like, okay, well, I don't have a thousand dollar deductible anymore. So let's really look at, it worth it? If I'm going to have to pay a $5,000 deductible to get
Rich Bales (33:21)
Mm-hmm
Yep.
Blake Hunter (33:48)
you know, a couple thousand dollars and work done is probably not worth it anymore.
Rich Bales (33:51)
Yeah,
totally. that's, mean, we encourage our clients before you file claims, things like that, call a roofer, have a roofer come look at it and actually give you an opinion. Find a reputable enough roofer that's not just gonna say anytime I show up, yes, it needs a new one. Yeah, so like I've built out a pretty good network of them where I trust them, where they're the first ones to say like, you're in good shape, don't file a claim because once you file a claim, it's also impacting you substantially more than it ever has where,
Blake Hunter (33:58)
Yeah.
You got it rough. Yeah.
Rich Bales (34:21)
you if you get a couple of claims within five years, there are a lot of carriers that are going to drop you and it's going to be really hard to get new insurance. So we have to be a lot more responsible in guiding our clients surrounding claims and when they should and shouldn't do them. So, again, that falls back on that education piece that we're so heavy on is like,
Blake Hunter (34:26)
Yeah.
Mm-hmm.
Rich Bales (34:41)
You need to be able to trust us and rely on us to be your advocates and advisors when it comes to this versus just the, hey, I emailed you a quote, talk to you when it renews maybe, which is kind of like the original way this market was designed.
Blake Hunter (34:52)
Yeah.
Yeah,
yeah. What's something that, I mean, we really talked about a lot of these things, but what's something that you wish more people understood about insurance?
Rich Bales (35:08)
Yeah, I mean, would think, I think it's such a commoditized industry is the biggest challenge where.
I just wish people had a basic understanding of what the coverage is meant, right? I mean, I deal with, you saw on my Instagram title, a lot of my clients are these luxury home buyers, homeowners that have four or five, $6 million properties, and they might be driving around on state minimums because they built it online and have no idea. So, you know, maybe it has a net worth of $10 million, $15 million, but if they get in a car accident, their insurance covers them for 25 grand.
Blake Hunter (35:43)
Yeah.
Rich Bales (35:44)
and then everything
else comes out of pocket and they've got all these assets that are on the table and it's like you could have spent an extra 150 bucks a month and protected everything you built and you didn't because
Blake Hunter (35:57)
Yeah.
Rich Bales (35:57)
you thought you were getting a steal, right? So that's why we're so adamant, like one piece of our process, doesn't matter if you're on the commercial side or if you're on the personal line side, you get a video and it walks you through the quote line by line so that you actually understand what scenarios these coverages are used, what they mean, why we recommend them, what's optional, and we'll make you tell us you want it off of there versus being like, hey, I'm going to be the cheapest guy here and I'll just email you a quote. And then, you know, if three or four people do that, all
do is they go, what's the one number on here I understand, it's price. But then it hails and they go, holy crap, I had a 3 % deductible, I don't have 15 grand. You know, so I just wish people sometimes the insurance base would slow down and I think, you know, our industry does it to ourselves.
Blake Hunter (36:29)
Yeah.
Yeah. Yeah.
Rich Bales (36:45)
where it's become like any industry that's sales-based is people want to make money so they'll cut corners to be the cheapest, but that encourages people not to actually pay attention to the things that matter that protect them.
Blake Hunter (36:58)
Yeah, it's, I tell you, you know, I'm in it and, and I deal with it a lot. And it's even sometimes for me, it's, it can be overwhelming. And so it's like, you know, I just had a conversation with a CPA the other day and like, you know, taxes, it's like, for me, sometimes it's like in one ear out the other. And it's like, you start talking about price and like, well, look, we can help you do this, this and this, but this is our price in order to do so. Or you can say, Hey, I'm going to give, I'm just going to give all my paperwork to this guy and
Rich Bales (37:07)
Mm-hmm.
Blake Hunter (37:28)
whatever happens happens and I'm going to pay my taxes and you know, he only costs $400 to do my taxes. So that's what I'm going to keep doing. It's like, to me, it's the same thing. It's like, hey, I need to really look at what's because you don't think about until something bad happens. you know, insurance is the example of that. So I can definitely see how, you know, people get four or five quotes, they look at it like, well, I'm sure they're quoting me all the same thing. This person for some reason is a little bit cheaper. So
Rich Bales (37:37)
Yep.
Right, and it's too late.
Yes.
Yep. Yeah, I mean, we are the first ones to see it where it's like, can guarantee you the company that we have that comes in the cheapest every time is not the best company we have when it comes to claims. Right? So, you know, I always try to level with my clients where I'm like, at the end of the day, if it's like have high end insurance coverage or put food on the table, like brother, feed your family. I'm not here to tell you, you've got to have the, you know, the
Blake Hunter (37:58)
I'm going there.
Yeah. Yeah.
Rich Bales (38:25)
Rolls Royce of insurance when you're trying
to barely get by, but if you're clearing a million dollars a year and you have all these assets and all this liability, I don't care if it's $3,000 more a year. If it means the day your mansion burns down, you can get a check and walk away from it and aren't forced to rebuild it and there was no limits on your coverage. Like that's worth it every time. And you can't convince me otherwise.
Blake Hunter (38:46)
Yeah. Yeah.
Yeah.
Rich Bales (38:50)
And those people generally understand it once we have that conversation. go, man, I don't know, that guy I talked to last year just told me it'd be cheaper if I did this. And you know, it's like...
Blake Hunter (38:58)
And it's
usually the people that can afford it anyway.
Rich Bales (39:00)
Yeah, totally. And I'm like, dude, you got a million dollar wine collection in the basement. Like, that's not covered. Yeah, right. Right. So it's, yeah, it's, I don't know. I just try to do my piece in that we give them as much education as they're willing to consume. And, you know, usually in a five minute video, we can teach people more than they've ever known about insurance. So.
Blake Hunter (39:05)
We need to start talking to the same people.
Yeah. Well, that's awesome, Rich. I really appreciate you coming on here today and, and giving some insight and getting to know you a little bit better. Hopefully we can connect in person either, you know, in the Des Moines area or when you come back to Omaha at some point. So I'd love to do that. yeah. There you go. There you go. There you go. There you go. Well, thank you. I'm sure we'll be, hopefully we can do some business together here soon. And if nothing else.
Rich Bales (39:35)
Yeah, absolutely. I've been craving some Oscars wings, so I gotta get, gotta get back out there. Or maybe salty water in Council Bluffs.
Blake Hunter (39:52)
Grab some wings. Thanks, Rich.
Rich Bales (39:53)
Yeah, for sure. Thanks, brother.